So you’ve set up at least one social media page to promote your business and hopefully gain some sales. This sounds easy, right? Run some ads, post some promotions, and get to know your customer base. But how can you know just how effectively those tactics are working? As you set out to market your business on social media, you need to make sure you have a basic understanding of how to measure your return on investment, also known as ROI. Below, Virtual Market Advantage will look at 5 aspects you should understand to improve and track your ROI for social media marketing!
What is Social Media ROI?
This is a loaded question that will have a different answer based on your business and its objectives. Your preferred ROI could be a focus on brand awareness or customer satisfaction. What it boils down to is that social media ROI is all of your social media actions that create value. Looking at all the time and money put in, what is your return?
Your return should be measured in terms of dollars, and you should know these 2 things when looking at it:
- How much money is going into your social media marketing efforts?
- How much money your social media goals are worth.
Now that you’ve considered these 2 factors when you look at your social media ROI, let’s look a little closer at the process.
Why it’s Important to Measure ROI
No matter where you look on any business marketing website, you’ll see the mention of social media marketing everywhere. It’s true that you can use social media to reach people you would never have come into contact with before, but you cannot just blindly throw money at a marketing campaign and hope for the best. You need to measure your social media ROI for a few reasons:
- To determine where you can improve your efforts.
- To decide which social media outlets fit your business best and bring the most value.
- To see how specific changes can impact your social media goals.
3 Steps to Defining Your Social Media Marketing
To really measure your ROI as discussed above, you should follow 3 simple steps when you start to set up your social marketing campaign:
- Choose a Goal – Do you want new followers, more online purchases, or something else?
- Track Your Goal - You can use Google Analytics or a similar tool to track whatever goal and conversion you are focusing on at the moment.
- Assign a Monetary Value - Once you have a goal and have tracked it, you need to track your ROI on this goal. That can be done by looking at average cost or lifetime value. How you track that ROI value is up to you and what’s best for your business.
To get the most accurate data, you should set your goals to be based on actions that convert the casual web surfer into a paying customer. Take the time to really set up your campaign to get those converted customers and you’ll find it easier to track your ROI on that goal. It's harder (or impossible) to track the ROI on a customer who doesn't end up paying you any money! The more specific your goal, the better your ROI tracking will be.
Tools that Help You Measure Your Social Media ROI
Once your goals are set and you have your marketing campaign ready to roll, it’s time to figure out which tools you will use to track your social media marketing.
Here are four options for tracking your social media ROI:
Google Analytics - This is a great tool that can help you track the details of your campaigns and your goals.
Google URL builder - This tool helps you assign trackable links for your campaigns.
Sprout Social - This tool allows you to schedule your social media posts.
Facebook Pixels - This is a piece of code placed on your website that lets you track conversions from Facebook ads, including everything from leads to actual sales.
Reporting and Making Adjustments to Your Campaign
As you start getting data back on your ROI, you need to report your findings and make adjustments where necessary. You can create an analytics template that lets you track your metrics without needing to build an entirely separate custom report for each campaign. If you need to share these reports with others at your business, make sure you report the data in clear language. Not everyone speaks in social media data terms, so you want to make sure that they fully understand the information and will be able to help make the right decisions and adjustments where they are needed.
Ideally, you should check your metrics daily so you can be sure your social media goals are being met. Staying on top of this helps you see where your campaign and overall goals need weekly or even daily adjustments. The lifecycle of a social media campaign is short, so you need to always be ready with the next idea. It helps a lot to know what your goals are and if they are being met.
The world of social media marketing is ever-changing, but if you follow these steps and use the tools mentioned above (or some of the many others that are out there) you’re sure to see an improved ROI on your marketing efforts and see your overall goals get met!
If you want more information on marketing, SEO, web design, coding, and more, check out Virtual Market Advantage’s other blogs, such as this one that goes over why SEO can take a long time to have an effect.